Fundamentals of Trusteeship

Welcome Michael Mizzoni Deputy General Counsel Department and Board of Higher Education

Session Outcomes  Greater understanding of the Framework for Trustee Work  What is the role of the trustees?  What is the role of the BHE?  Trustees as Fiduciaries  10 Fundamental Responsibilities

4 Higher Education Governance

M.G.L. Chapter 15A “It is hereby declared to be the policy of the commonwealth to provide, foster and support institutions of public higher education that are of the highest quality, responsive to the academic, technical and economic needs of the commonwealth and its citizens, and accountable to its citizens through lay boards, in the form of the board of higher education and the boards of trustees of each of the system’s institutions.”

Role of the BHE  The BHE is responsible for defining the mission of and coordinating the Commonwealth’s system of public higher education and its institutions.  The BHE’s enabling legislation also includes several specific governance and oversight responsibilities.

Examples of BHE Legislative Responsibilities  Analyze present and future goals, needs and requirements of public higher education  Establish goals to achieve well-coordinated, quality system  Establish coordination among post secondary public institutions  Resolve conflicts of policies or operations  Approve 5-year master plans, & develop a 5-year system master plan  Develop performance measurement system and funding formulas  Approve mission statements  Approve admissions standards and affirmative action plans  Approve presidential appointments and removals  Approve and fix presidential compensation  Define and authorize new functions or programs;  Set tuition rates (campuses set fees)  Collect, analyze and maintain data from institutions  Coordinate activities and engage in advocacy

Role of Boards of Trustees Boards are “responsible for establishing those policies necessary for the administrative management of personnel, staff services and general business of the institution”

9 Higher Education Governance

Examples of Duties and Powers of Local Boards : M.G.L. c. 15A, § 21 & 22  Each board shall:  Develop a mission statement  Prepare maintenance and capital budgets  Manage and keep in repair all property  Establish fees  Appoint, transfer, dismiss, promote and award tenure  Seek, accept and administer grants, gifts and trusts  Implement and evaluate affirmative action policies and programs  Establish, implement and evaluate student services  Recommend to the BHE admission standards  Have authority to transfer funds within and among subsidiary accounts  Establish/operate programs in accordance with degree conferring authority  Submit a 5-year master plan to the BHE  Submit financial data as required  Submit an annual institutional spending plan  Submit an institutional self-assessment report  Appoint & remove the CEO (with the approval of the BHE)

Overview and Comparison : Legislative Authority of BHE and Local Boards

Overview and Comparison:

Trustees as Fiduciaries  Fiduciary – One who holds some asset(s) in trust for another and is charged to act beneficially on behalf of the other in managing that asset.  The Asset – The college/university you govern, including mission & identity, property, human resources & educational product.  For Whom – Founders and sponsors, students and families, donors, alumni, (the public)

Fiduciary Duties  Duty of Care – Act in good faith for best interests of institution – Act reasonably, competently and prudently  Duty of Loyalty – Put interest(s) of institution above all else – Do not act from self interest; no self-dealing – Conflict of loyalty  Duty of Obedience – Obligation to advance mission – Duty to act ethically and consistent with mission  Serve a Public Purpose

15 1. Ensure that the institution’s mission is kept current and is aligned with public purposes. In the case of a multi-campus system, ensure the alignment of each campus’s mission with the system’s vision and public purposes. 2. Select a chief executive to lead the institution. 3. Support and periodically assess the performance of the chief executive and establish and review the chief executive’s compensation. Ten Fundamental Responsibilities of Effective Governing Boards

16 4. Charge the chief executive with the task of leading a strategic planning process, participate in that process, approve the strategic plan, and monitor its progress. 5. Ensure the institution’s fiscal integrity, preserve and protect its assets for posterity, and engage in fundraising and philanthropy. 6. Ensure the educational quality of the institution and its academic programs. Fundamental Responsibilities

17 7. Preserve and protect institutional autonomy, academic freedom, and the public purposes of higher education. 8. Ensure that institutional policies and processes are current and properly implemented. 9. In concert with senior administration, engage regularly with the institution’s major constituencies. Fundamental Responsibilities

Conduct the board’s business in an exemplary fashion and with appropriate transparency, adhering to the highest ethical standards and complying with applicable open- meeting and public-records laws; ensure the currency of board governance policies and practices; and periodically assess the performance of the board, its committees, and its members. Fundamental Responsibilities

Trustee Responsibilities  Advance educational mission  Oversee policies and plans  Measure results  Ensure sound financial management  Advance philanthropic goals  Actively participate in board and committee meetings  Review strategic plans  Put the institution first, before personal interests

20  When in doubt, reach out to Legal Counsel or  Send an to Jennifer Perkins in the Office of Trustee Relations  Resources: Trustee Web Corner *Special “Thank You” to AGB’s Dr. Merrill Schwartz for content